Two trains/Two tracksSite agnostic=may or may not happen within the confines of the site.Discrete=quantized. Continual= range.
Site-specific can be estimated accurately, site-agnostic cannot. It seems like a lot of our discussion has been in site-specific and none in site-agnostic.
Limits of site-specific• Historical data, not specific to Fenorris. If you used a projection like this for Google or Facebook, it would predict 0 revenue. If you used it for Windows Smartphone, it would be too high.
Limits of Site-Specific• Takes average, ignores total price (Fenoriss’ items are very high price. So that means the site-agnostic data is very important.
Why can’t site-agnostic be estimated accurately?• Because it is predicated by traffic, e-herd, like stocksAnd you can never guess what people will actually do until they do it, since there are toomany z variables, also known as “static.” Predicting in a non-linear dynamic system is likepredicting stocks or the weather, we don’t do it in revenue projections. But there areother signs a stock is hot even if cannot be predicted. Even genius stock pickers are wrongaround 60% of the time but when they’re right, they’re really right, when they’re wrongthey’re only somewhat wrong. This is due to causal portrait modeling.
So why should I care about site- agnostic aspects of the campaign if I cant quantify the benefit?• There are qualifiable not quantifiable benefits: reach, network effect, valuation, community, % chance sales, competitive adv, our authority
Targeted vs non targeted, theprojection never accounted for non- targeted
Site-specific: We can lower the cash reqs but we can’t change this trendThis is typical for longer term investments such as realestate, if you don’t like this chart, you should not dointernet marketing.
Healthy signs of risk reduction Other healthy signs are engagement, social signals, feedback from people.
What is MAPE?• The chance that this number will be wrong, it can be wrong by $0.01 and still have 10% MAPE. It is not the chance that the projection is wrong. This is because 1) There is a pos/neg skew. 2) This distribution is Gaussian. 3) There is a higher limit MAPE distortion.
RVR• The RVR is incredibly high which show very limited risk.• RVR of Apple Stock in Sep 2009: 1.4• RVR of campaign: 4• Caveat: RVRs oversimplify risk (does not capture skewness or kurtosis)
Marketing campaigns• Don’t fail or succeed in the blink of an eye. If they are failing it becomes pretty clear from the outset. We will poor social signals, traffic numbers, feedback etc. That being said, never invest in marketing unless you can handle losing all of your money.
Testing• Opinions are wrong, testing is right. If 500 people all get onto a site and say it’s a good idea, then it is. If not, then it isn’t. This should be done for US and India.
Real risks• What are some of the real risks?• Traffic is high, sales are low. This would mean a longer period of time for recoup of principal.• SEO is not a good traffic source, for w/e reason. This would mean higher-cost advertising.• Electric is not reliable. This projection was not specific to us however.
False risks• I can spend 50K and see nothing.• I am revenue negative for too long: If you can’t be revenue negative for a year, internet marketing is not for you. There is always the chance that you won’t be but it cannot be qualified.
India and US should both be done• Projections were done with cross-transferring utility assumption, which is why India looked so good.• Both markets are self-supporting.• Jumping into the other market is easy.• Testing will show where we can focus more of our energy. Also, I already mentioned the India projection is not even valid.
Computational Simulations• Ran but am not happy with them yet, I had a colleague look at them and he said they were not good enough.• Without live data, the simulations are just for our own amusement, however. We should go ahead and fund the tests now.